Rate hikes a risky strategy for bursting bubbles

Sir John Gieve, a deputy governor at the Bank of England, has spoken of two reasons why central bankers should be wary of disciplining financial markets by raising rates.

"First, policy has to be appropriate for the whole economy; the interest rates which would be needed to have a significant effect, say, on the growth of house prices in recent years might have been far too high for other industries," Sir John said. "Secondly, central bankers have been cautious to put much weight on their own

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